Umbrella insurance has an unusual name, but it’s a simple concept–it’s an extra liability policy for added peace of mind. Most commonly, umbrella insurance is something you get in addition to either a car insurance or homeowners insurance policy.
Umbrella insurance is specifically about liability, which is the cost you might have to pay to somebody else for an unfortunate event where you are held responsible. It doesn’t usually include losses you bear yourself, such as if your property is damaged or your possessions are stolen.
Which insurance solution is right for you?
Explore how having the right insurance can protect you from the unexpected.
Property Damage Liability
You can be held responsible if you significantly damage another vehicle and/or property. Do you have enough coverage to protect yourself from the risk?
Your standard auto policy limit could easily be exhausted if you are found to be at fault. An umbrella or excess liability policy provides an extra layer of protection once your standard liability limits are exhausted. It’s a cost-effective way to ensure the peace of mind you deserve.
Bodily Injury Liability
It’s easy to get distracted while driving. All it takes is an incoming text message, a fussy baby or a little spill of coffee and your eyes off the road long enough to crash into a pedestrian, bicycle or another vehicle. As an owner/operator of the vehicle, you may be held financially responsible for any bodily injuries caused as a result of the accident.
An umbrella or excess liability policy helps extend your coverage to better protect you against these significant costs. It’s the ideal coverage to provide peace of mind, even when the unthinkable happens.
You invite guests over for a barbecue pool party and one of your guests dives into the shallow end of the pool and is permanently injured. They hire a lawyer to represent them and after a long legal battle, you and your family are left financially responsible for their injuries. Do you have enough money in savings to cover your legal responsibilities as well as the legal defense costs?
An umbrella or excess liability policy increases your personal liability limits by adding protection over and above your current auto, boat or homeowners policies - providing real financial value, as well as priceless peace of mind. Excess liability insurance is available either by an endorsement to your homeowners policy or available as separate coverage.
You’d usually get umbrella insurance when your main insurance policy has liability coverage limits that are too low for your needs. Umbrella insurance will only pay out when your main policy has already paid out in full, and it will only pay out the remainder of your costs.
For example, if your auto policy covers liability up to $500,000 but you cause an accident that leaves the other driver with medical bills of $600,000, your main policy will pay out in full, and the umbrella insurance policy will kick in for the remaining $100,000.
The umbrella insurance policy itself will have its own limit, but this is less likely to be an issue. An umbrella insurance policy can be cheaper than you might think. While it covers large potential payouts, the premium usually reflects the reduced risk that the policy will need to pay out.
Talk with us about adding a cost-effective umbrella insurance policy to your account. It’s easy and provides the additional protection needed to protect you and your family.